The Institutional Investors Conference. I'm here with Voya's CEO, Heather Lavallee, and CFO, Mike Katz. With that, I'll turn it over for their presentation.
Okay. Good morning, everyone, thank you, Wilma. I'm gonna begin by highlighting what makes Voya such an attractive investment opportunity. It starts with our complementary businesses, where we operate at scale, which is durable, we've got a leadership position in the workplace businesses. The collection of these businesses generate high return on equity, high free cash flow, that's important because it allows us to continue to invest in our businesses, deliver for the customers, while returning meaningful capital to our shareholders. I'm gonna turn talk a little bit about our business mix.
Simply put, our businesses serve our customers at every stage of life. We offer financial solutions that help from the brand-new employee who is enrolling in their retirement plan for the first time, or their employee benefit offerings, all the way through to retirement, where people are enjoying the retirement savings, to and through and every stage in between. Our retirement business is at the center of the workplace, which is where we operate, and it's complemented by an asset management and an employee benefit business that offers financial solutions to help ensure our customers can secure a financial future, as well as protecting against an unforeseen event in life.
If I start with retirement, we are an at-scale retirement provider. We are top five in the industry, and we have generated industry-leading margins for over a decade. We have meaningfully grown this business in the last couple of years. In 2025 alone, we added nearly $100 billion in assets. We did that both organically and inorganically. In the last two years, we've grown our participant account base by 40%, and we now serve nearly 10 million participant accounts to and through retirement. In our employee benefit business, simply put, we help employers to be able to manage their overall benefits programs. Benefits have gotten quite complicated, and if we think about what we do for the customer, it's helping the employees and their families protect against unforeseen medical events. In employee benefits, we hold a number three position in supplemental health and a number three position in medical stop-loss.
Finally, if I turn to investment management, we have breadth and depth in this business. We operate both in the U.S. Internationally, in both retail and institutional, and we have meaningfully increased margins while outpacing our peers in terms of organic growth. What sets us apart is the financial performance. Return on equity of close to 19%, which has been driven by the strong earnings from our retirement and our investment management businesses and the high margins they generate. In addition to that is the fast-growing wealth management business we have inside retirement. It's also been driven by the margin improvement in employee benefits. Mike will talk a little bit more about that.
On the right-hand side, our free cash flow is really second to none. 2025 was a great example of this, where we generated 90% free cash flow on after-tax earnings. If you look back at our track record over the last decade, on average, we have generated a 90% free cash flow over that entire time. Why that's so important is it has allowed us to continue to invest in our businesses, do smart, accretive acquisitions, while continuing to return meaningful amounts of capital to our shareholders. As we think about 2026 and beyond, our focus is on continuing to grow cash generation, deliver for our customers, and increase value for our shareholders.
Mike?
You know, Heather, when I think about companies with strong balance sheets and strong businesses, it really reveals itself in how they're deploying capital. When you look at our track record, both across dividends and share repurchases, we have that. We've been able to increase the dividend each year. You look at 2025, we generated $775 million of excess capital. $775 million. That's a testament of the businesses that we're in, and frankly, when we think about our conviction on dividends, it's because the durability of that free cash flow generation prospectively persists. From a share repurchase perspective, we view this as an important part of the value proposition in Voya.
We look at the first half of 2026, and we've already signaled to the market, expect $300 million of share repurchases in the first half, so nearly $400 million of capital deployment back to shareholders in the first half of the year. The other good thing about this is that as we're buying back shares, it positions us to increase the dividend while maintaining the nominal amount that we're returning through dividends each and every year. If you look at 2026, we're gonna be buying back shares, and later this year, we're gonna be increasing our dividend. If you go to the next slide and we look at this balance sheet, from an RBC perspective, very strong, well above our target range. When you look at the amount of excess capital that we have heading into 2026, feel really good about that.
Leverage, right in the middle of our 25%-30% range. We had over $1 billion of pre-tax adjusted operating earnings in 2025. Leverage was exactly the same. We did not use leverage to increase earnings. Frankly, exactly the same. We grew earnings over $150 million on the back of the businesses that are growing and delivering so much commercial momentum. In the middle, when you look at the way we're investing our general account, and by the way, we've got a group of investment professionals that not only do this for Voya, they do this for 70 other insurance companies. We feel very well positioned. We know it's volatile out there, but we've come into 2026 in a position of strength, very well diversified.
When you think about what we're investing in, very much investment grade. The other part about the general account, it's an important part of the value proposition at Voya because it unlocks synergistic value between Investment Management and our Retirement and Employee Benefits business. The Investment Management business earns a fee for managing the general account, and it's also an important part of the commercial momentum because we're showing what we can do. We're eating our own cooking in our own general account. That's been part of the value that we've been able to deliver to those over 70 insurance companies. Part of the big organic growth, we delivered almost $15 billion of organic flows in 2025 in Investment Management. It also delivers that durable spread income primarily in retirement, but also our Employee Benefit business.
Finally, on the next slide, you know, when we look at the value prop. We're here at Raymond James, you know, obviously we wanna share the investment proposition with all of you. As I just mentioned, and Heather signaled as well, like, we're doing the same thing. Like, we know Voya better than anybody. We see the valuation opportunity. We're leaning into it. We're not just asking you to. You can look across these three pieces here, but really at the end of the day, we've got our near-term priorities really moving with pace. We talked about commercial momentum in our businesses, investment management, retirement. Heather talked about that.
We've also talked about the OneAmerica transaction. We bolted on a small retirement company at +30% returns. We've integrated the majority of that in 2025, realizing what we said we'd realize. Finally, in employee benefits, which we know there's a lot of questions around that that we've been getting from investors, we delivered over a $100 million earnings improvement in 2025. It's a part of the value proposition as we move forward. Frankly, when we think about the story on Voya, all those questions in the past have driven this valuation discount. We believe the story's moved. EB did not get in the way of an incredible 2025, and the actions we took in 2025 positions us to be able to say the same in 2026.
Heather?
Thanks, Mike. Before we open it up for questions, I'll close by just reiterating that we see meaningful near-term catalysts to improve our multiple expansion in our business. It starts with the commercial results we drove in retirement investment management, where we now serve 1 trillion in combined assets between both of those businesses. Mike mentioned record flows in both businesses in 2025, which creates a catalyst, and then I talked about our expansion in wealth management. Second is the continued improvement of margins in employee benefits. Finally, it is our shareholder-friendly approach to capital deployment.
As Mike mentioned, we are gonna continue to deploy capital into the most accretive opportunities. We believe that our value proposition is clear, and Voya is a compelling and attractive investment opportunity. Thank you.
Thank you for the great presentation. J ust going to move to a little bit of Q&A here. First we'll start with Voya's strong cash flow generation, which has been very impressive. What drove strong results in 2025, and what are the key contributors in 2026?
Mike?
Yeah, sure. It's really an outcome of what I was talking about just a moment ago. We have clear near-term priorities around commercial momentum, organic growth, the acquisition that we did at OneAmerica, and then finally the EB piece. When you look at the organic growth in retirement, you know, over $20 billion of flows plus the $60 billion that we brought in from OneAmerica. Investment management, I just mentioned nearly $15 billion of organic flows in IM, different than I think a lot of other companies out there. Made a lot of progress in integrating OneAmerica. We talked about $75 million of earnings from that transaction. We're exceeding that target.
Finally, as I mentioned with EB, that margin improvement story. We grew earnings in 2025 over $100 million. That's not the end of the story there. We see margin expansion in 2026 and beyond. We continue to make progress. That's gonna be part of the value proposition in 2026. That $775 million that Heather and I talked about, we expect that to be higher this year and for the years to come.
Yeah, the only thing I would add is we've always had an approach of being really disciplined with expenses, which gives us the opportunity to reinvest into the highest opportunities within the business.
Great. Could you talk a little bit about what makes the industries you operate in appealing?
Yeah. If you think about the businesses we're in, first in the retirement business, we're gonna have roughly 100 million millennial and Gen Z workers in the workforce, and it's gonna be one of the largest wealth transfers, $84 trillion of assets that are gonna transfer to the next generation. We see that as incredibly attractive. The other piece of it is that if you just think about the retirement and then the overall benefit landscape, it's gotten complicated. If you think about the U.S. worker, they've got to make close to 20 different decisions every year in their benefits, and that's difficult for people.
I think about my adult kids that are enrolling in their benefits, and they call mom and say, "I'm not sure what I should do." Being able to offer guidance and benefits at the workplace, which is where most employees are looking for trusted, you know, trusted advice is key. We love that. Finally, in investment management, we continue to see a traction for the U.S. dollar-denominated funds in Asia and continued growth of not only accumulation vehicles, but income-generating vehicles in retirement.
Could you talk a little bit more about why Voya is competitive in these industries?
Yeah. I mentioned a little bit, again, I start with retirement. You have to be a scaled provider in this business. Why that's so important is it allows us to continue to invest in capabilities, digital, cybersecurity, to be able to deliver for customers but operate at industry-leading margins. Otherwise, you just, you can't have both together. That's number one. We've got an incredible brand. We're well-known, great distribution. Same in employee benefits. We are viewed in the market as a workplace company. We're not just a wealth manager who happens to do workplace along the side. This is our core business, and that is important in within the markets that we serve.
You know, finally, I think about investment management, and it goes to something Mike mentioned. As an insurance-owned asset manager that manages our own general account, the fact that we can take that to 80 different insurance clients that we serve, we think about the breadth and depth, the strong investment performance, we've got a reputation, and we've delivered for our customers across all three businesses.
How are your businesses working together to serve your customers?
Yeah, this is one, we love the collection of the businesses. If I think about it, first for employees, today, employees need advice and guidance. More and more, there's an interesting trend in the workplace where five, seven years ago, employers would say, "I just want you to be my retirement provider, and I don't want you to offer retail planning and other solutions." Today, they're asking for those services. The fact that we've got $10 million participants in retirement, we've got close to another $10 million through employee benefits, we're able to leverage that access to the workplace and bring broader advice and planning into the employees. Broader advice and planning, so really complementary.
We're also able to take the proprietary solutions we manufacture in our investment management business directly into our clients. As Mike mentioned, we talked about managing our own general account. That is an incredible asset for us to be able to take that drive yield and returns for institutional clients, at the same time driving strong earnings growth for Voya.
Could you talk a little bit about your strategy to drive medium-term growth?
Sure. As we think about it, I'll hit each of the businesses quickly. In Retirement, it's about continuing to grow organically. Mike mentioned over $20 billion of flows last year. It was actually $28 billion of organic flows. We also wanna be opportunistic about doing additional bolt-ons like we did with OneAmerica. Right now, we've got a really high bar for that just given where we trade in the market, but we see that as an attractive opportunity. Finally, it's the build-out, the thoughtful build-out. We'll do what we're doing of our wealth management business. In employee benefits, it's all about continued margin expansion.
Finally, Investment Management. It's continuing to leverage the growth that we've done within the insurance channel, privates and alternatives, as well as global expansion, where our clients are really looking for income solutions.
Organically, just to build on Heather's point, like, we, you know, do see continued consolidation in the retirement space, and we see us as a company that can participate in that. We're gonna be looking for returns, you know, well north of 20%. You know, factoring in, you know, how we see the execution risk of a particular opportunity. Part of it's just, you know, Heather, as we've talked about just a moment ago, that, you know, there's a retirement company, a workplace company we know better than anybody in Voya, buying back shares, the bar is very, very high right now.
Why we talked about $300 million of share repurchases in the first half is because we don't see anything imminent in the near term that would take us off course of returning capital through that dimension. The other thing that's important, too, and it's something that, you know, Heather and I take really seriously, is that we believe that it's important for us to continue to be in the market buying back shares. You should expect that for the foreseeable future. We can do that and still participate in retirement opportunities. We structured a deal where there was a small upfront with an earn-out. Those are the kinda things that we're gonna do that if we see a really good opportunity, and we wanna be able to both take advantage of that opportunity but continue to take advantage of valuations.
We're gonna find a way to do both. That's really important to us. We feel like we've got the strategic flexibility based on where the balance sheet right now is to take advantage of that.
How do you approach wealth management to retain assets as boomers approach retirement?
With wealth management, I think what's first important to notice or to mention is that we already have established wealth management business inside retirement. Today, it has generated about $200 million of revenues in 2025, which is roughly 10% of our broader retirement business. We're building from a strong foundation, but what we realized was we frankly did not have enough advisors to be able to serve those clients, and we weren't getting to all of the inbound calls of people who wanted to roll over into an IRA or consolidate assets. The first thing we've done is we've expanded our phone channel reps. Ultimately, we wanna get to, say, 500 to 700 advisors over a period of time gradually. We probably sit at about 200 today.
We've got about 450 field-based advisors that have, for probably 30 years, supported our tax-exempt clients, very holistically. Helping them make decisions around should I roll money in? Do I need to have an annuity? Should I roll money over? That's a key component is advisor expansion. We're also investing modestly in building out digital self-service. While we're, you know, attracted to Baby Boomers, our real focus is on serving millennials and Gen Zs because most Americans do not have access to a financial advisor. We're not going after the high-net-worth individual. We're going after the average American that we are serving today in our workplace businesses who need these solutions and are looking to their employer and be able to have digital solutions to be able to address those needs.
That's really how we think about it. Maybe the final bit is we also have proprietary products that we sell through third-party distribution, and that's been an important component as well. Think about that as more of mutual fund IRA products. We've had a real track record of delivering value for clients in that space as well.
Heather, I think, you know, one of the challenges as a CFO is, you know, investing. In fact, you know, revenue growth is so critical. I think one of the things that we have a privilege at Voya is that in key investments like wealth management, which we see as an important part of expanding the retirement revenue growth over time, is that we're able to self-fund the majority of these investments. At the same time, we're making the critical investments in technology, growing our advisor base. We're also finding the efficiencies within the company so that it's not taking us off course in what we talked about earlier on growing excess capital, which leads to the strategic flexibility, which leads to the value proposition we talked about a moment ago.
Just to be clear, like, we're able to do this while still delivering on the financial goals that we have.
Yeah, maybe one other bit, then we'll move back to you on the wealth management. One of the reasons we think it's so attractive is this is fee-based business. It's capital light, it's fast-growing, and again, you think about the modest returns. We don't have to really overstretch what we think is possible to have a meaningful impact in what we're driving. When we think about this, think about, you know, double-digit revenue and earnings growth at the same high margins we've generated in retirement. We think really accretive and over time can help drive that multiple expansion.
Can you maybe talk a little bit about any tech advantages or AI and how you can use that in the retirement segment? Just talk about is that something you could see helping the margin going forward?
First on tech advantages, one of the things that is not always fully understood is our retirement platform is built on technology called Omni. What makes it unique, there are some providers who will say, "We have a proprietary record-keeping platform." Well, we don't need to have a proprietary record-keeping platform because we work with the largest in the industry, but we also own the source code. We actually have more Omni developers than FIS that owns Omni. It is an important leverage point for us where when there are certain things that are coming in as regular updates, we leverage those from Omni, and then when there are other things that we wanna do our own specific code to meet client needs, we can do that. That's actually been a competitive advantage for us.
The second thing I'd mention is we have a global capability center in India, and this is not about labor arbitrage. This is actually where a lot of our technology advancements come from. This kinda goes to the point, Wilma, it's been an important leverage point for us to be able to maintain those high margins I talked about in retirement for a decade. That has set us up well to be able to lean in on AI. We were the first actually retirement provider with a transactional mobile app capability close to a decade ago. We've added Behavioral Finance Institute, which helps people make smart decisions around their retirement and where to allocate those dollars.
When we think about AI, we're gonna be leaning in on things that drive, you know, easier, RFP processing, things around claims, things around the way we're driving operational efficiency. We do think this is gonna be an important leverage point for us to continue to deliver a better experience for our customers while driving efficiency. Call center is another great example. We've had chat for a number of years. It's very natural to be able to move into natural language, you know, conversation with our clients to give that first caller resolution in a very efficient manner.
You're not gonna hear from us like, "Oh, here's this big cost takeout because AI," that you're not gonna hear that. What we're really focused on is the education and the adoption within our disciplines in our company. While we monitor at the top, we think it's really important that the individuals within each particular function understand the new capability. It's moving really fast. We're training our folks in a very tailored way, so the folks in the finance organization are getting trained differently than the folks in the sales organization. They're getting different training in the underwriting side because they understand what they're trying to do every day, right? There's not a one, you know, one solution fits all here. They understand the data that's necessary. They understand what the customer needs that they're trying to serve.
We're really trying to enable our people to be able to understand how they can take advantage of it and then fund it. To the point earlier around whether it's wealth management or other key areas that we want to invest in, we think from a productivity and an efficiency perspective, that this is gonna be one of the tools that's gonna allow us to continue to invest for growth as we maintain strong margins in retirement and investment management, and then that expansion in EB.
Great. Thank you. Could you talk a little about some of the biggest opportunities in the employee benefits segment as well?
Yeah. One of the important opportunities right now, we have launched a lead management capability, January first of this year, why that's so important is, administering and managing employee leaves is incredibly complicated for employers. You've got federal leave, you've got state leave, you've got paid, you've got unpaid, and being able to have a capability that creates a very easy interface for employees through the digital, as well as proper reporting for employers is very important. Why we did that is because more and more the insurance provider that wins the leave is winning the bundle. They're winning the life, the disability, and the supplemental health. That's incredibly important, and as a number three provider in supplemental health, we wanna both defend that position but continue to accelerate it.
The second I'd mention is just, you know, high cost of healthcare. This is something we're all facing, right? We saw a rebound in the cost and utilization coming out of COVID. Employers are struggling to figure out how do they absorb the high dollar medical expenses in their overall benefit program. Having medical stop-loss, which is essentially a reinsurance layer for those employers that are self-insuring their medical, is an important lever for them to help them control costs. At the end of the day, it's about serving employees, it's about providing the right benefit offering, and about retaining and attracting those workers.
Can you touch on, where you're different in investment management?
I'm gonna let you--
Yeah. I can start here. Like, I think one of the things, and 'cause we'll get questions around you know, and as you all know, you're, I mean, you're in this business that, you know, it shifts, right, what's in demand and, you know, what's not in demand year in, year out. We're not concentrated in any way in where we play. Like, we play internationally. You know, Heather mentioned the distribution we have of our Income and Growth Fund in Asia. Domestically, we have that both from an institutional and a retail perspective, and so very broad-based in where we play. We're not overly susceptible if something comes in or out of favor. Investment performance has been phenomenal. I think that's really been key. We, you know, have heritage in fixed income.
It's part of the reason why we do so much for other insurance companies. You know, this is, you know, we've got a track record, Wilma, of really delivering strong organic growth. When we look at 2026, we, you know, we see the setup being just as strong. Our target is +2% organic growth, so that's, you know, no macro at all. We expect to grow organically 2% year in, year out, and we don't see anything at this point, you know, even with the difficult backdrop right now, taking a soft course and being able to do that.
Yeah, the only other thing I would add is that, you know, as we think about the wealth build-out, bringing proprietary solutions into that channel is important. We launched active ETFs in the fall. We'll continue to expand that, we're also going to be able to launch model portfolios that our advisors can take to our clients. It just kind of goes back to that complementary nature of the business.
Great. Could you talk about what you think is most underappreciated about your company or its stock?
Yeah. I think what's most underappreciated about the company is the track record we have with this 90% cash flow generation, growing the cash generation, the consistency that we have delivered on returns. We've navigated through, you know, different environments. I think what's underappreciated is the leadership positions we have, the discipline in terms of how we manage that, and how we're gonna continue to make decisions that are in the best interest of shareholders and growing that value. In our belief, we should be a $12 billion market cap company trading at 12x , not where we are today. I think underappreciating the fee-based businesses we have, particularly growing and what we've been able to generate in retirement and investment management, which is roughly 85% of the firm, are underappreciated in my, in my opinion.
Heather, maybe if you went back to the slide on valuation just briefly, if you still have the clicker. You know, I think we get compared to insurance companies, right? Obviously, I think, you know, valuations have been depressed there, and I think in some ways that's fair, right? We employ benefits. The benefit business is an insurance business, but it's short-tail liabilities. These are not long-tail liabilities. These are not guarantees that sit on your balance sheet for years and decades. These are short-term liabilities that we reprice every single year. Investment management's certainly not an insurance business, and retirement has elements with the general account, but we talked about the synergistic values there.
Part of the reason why we're comparing versus Russell here, I think we think that's a-- It makes more sense in the small mid-category and part of the reason we're here at this conference 'cause, you know, look, there's its inertia is a powerful thing. You know, we have been an insurance company in the past. We had a life insurance business. We had a big variable annuity business back in the early days of Voya. Those businesses we've divested, and what's left has been done in a tailored way, in a way that really works, in a synergistic way in the workplace, but really is not insurance in the way that I think most people think about it.
I think that's part of the reason, Wilma, why, you know, where we're trading is probably not fair. We think it's yesterday's story, and we're pretty excited to tell today's.
If I can close with just some key stats. When you think about what we delivered in 2025, record commercial results in investment management, $15 billion of flows, $28 billion of flows in retirement, $60 billion of additional assets in an acquisition with a 30% IRR, over $1 billion in pre-tax earnings, 20% EPS growth, significant cash generation, right? I think those are incredible stats. We've got confidence in our ability to deliver going forward, which is why we've made the commitments on the share repurchase, why we've expanded the dividends, and we're confidence in our leadership team and our ability to continue to grow and deliver for shareholders.
Great close. Thank you very much, everyone. Appreciate it.
Thank you, Wilma.